Whether you're considering credit card processing for the first time or just considering a change, it's important to be prepared so you come away feeling good about your decision. Most business owners understand the need to accept credit cards and the benefits of doing so. But when you're ready to sign up for credit card processing services or switch processors, where do you begin?
Posted in Credit Card Processing on Tuesday, August 9, 2016
When you’re ready to shop or compare processing services, we invite you to consult with one of NCMIC’s fully-trained, non-commissioned representatives about the benefits of processing credit cards with us.
- Understand Interchange. An interchange fee is attached to each transaction and is the primary cost of accepting credit cards. It is a percentage of the transaction amount and is paid by you, through your merchant processor, to your customer/patient’s issuing bank. Interchange fees are determined by the payment brands (Mastercard, Visa, etc.) and vary depending on the type of card (e.g. debit, credit, reward). Different card types carry different transaction risks and therefore fees vary.
- Think About How You’ll Process. Will you accept debit cards? American Express? Would you like to offer pre-paid gift cards as way of generating new referrals? Is there a need for mobile processing? Will you use a basic terminal or process through your practice management software?
- When Will Funds Be Transferred To Your Account? The industry standard is two business days, but depending on the company you choose it could be longer. Reliable companies will transfer funds as quickly as possible and not hold your money.
- Review Merchant Agreements. These can be wordy. After all, it’s money transferring between card associations, financial institutions and bank accounts. That said it’s important to review them to ensure you understand all the terms and conditions. And ask questions! We’ve talked to hundreds of people who are stuck in bad agreements because they didn’t review them closely. This mistake can cost you money.
- Think Twice About Enticement Offers. If it’s too good to be true it usually is! You’ve heard it a hundred times, but this is extremely important when it comes to credit card processing. Unscrupulous providers may entice you with extremely low offers and rates, only to turn around later and raise them or charge additional fees after you sign up.
- Choose a Reliable Company. There are literally thousands of sources that will sell you credit card processing. You can buy through the internet, from banks, through ISO (Independent Sales Organizations) or directly from the processing company. Many banks and all ISOs typically sell the services offered by a processing company. Understanding who will ultimately be the organization servicing your account and providing support is very important as not all service is equal. Ultimately it comes down to who you trust to provide you with the best and most reliable service at a reasonable cost.
- Prepare to Compare. Besides interchange, there are other basic costs of processing that you’ll want to compare such as transaction rates, compliance fees (to protect you in the event of compromise or breaches) and equipment costs. If you’re comparing offers, make sure you understand all the fees as well as terms and conditions so you can make a knowledgeable decision.
- What Equipment Will You Use? Credit card processing terminals can range from $100 - $500 or more depending on the capability. Reliable terminals should be upgradeable for the latest security and software updates. Be leery of companies presenting you with free terminal offers unless the offer is from a reliable source. You should also watch out for terminal equipment leases as they may require large penalties if you decide to cancel.
When you’re ready to shop or compare processing services, we invite you to consult with one of NCMIC’s fully-trained, non-commissioned representatives about the benefits of processing credit cards with us.